This new tool will enable investment managers to find out which previously sold securities, if replaced through a purchase transaction, would result in a wash sale
An opposite and less desirable result that might occur because of a wash sale
is the conversion of a short-term capital loss into a long-term capital loss.
If the client follows a "buy-and-hold" strategy--which is consistent with the professional money manager's belief in not selling during market downturns--the goal is to sell these shares without triggering the IRC section 1091 wash sale
When a loss from a wash sale
is disallowed, the deferred loss is added to the basis of the newly purchased securities.
, Account Bifurcation, Account Transfers All Potential Pitfalls
FundTax expedites the wash sale
calculation process, which is critical during excise season," said Steve McCabe, vice president, Integrated Investment Services.
Beware of the Wash Sales
Trap (see sidebar, Page 18).
Not only can the Wash Sale
Rule prevent you from taking a loss, but failing to account for wash sales
can result in costly errors in cost basis calculations for both the stock sold at a loss and the security that triggered the wash sale
," said Conlon.
Asset managers and their administrators are responsible for accurately accounting for and reporting on specialized tax events such as wash sales
, qualified dividends income, and more," Peter Hess, senior vice president of the Global Accounts business unit for Advent, said.
GainsKeeper's enhanced short sale tax functionality automates the proper tax treatment of short sales, including special holding period rules and wash sale
But the real power of TradeLog lies in its ability to accurately apply the IRS wash sale
We get countless questions from people struggling to comply with the wash sale
rule and other tax laws for capital gains," says Kaye Thomas, author of the book "Capital Gains, Minimal Taxes" and founder of Fairmark Press.